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On February 1, 2020, Teal Corporation issued 3,300 shares of its $5 par value common stock for land worth $37,400. Prepare the February 1, 2020, journal entry.

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ayokenny2001

Journal entry for Teal corporation

Account                           Debit                      Credit

Cash                                  $37,400

       Additional Paid-In Capital                         $20,900

       Common Stock - $5 Par                          $16,500

      (To record issuance of common stock)

What is Par Value?

Stocks are issues in some states at par value which means that the company sets a minimum price that they can sell stocks at in their articles of incorporation.

Par value is similar to the face value of a bond and, often, companies will sell stocks for more than par value.

First, we need to determine what portion of the cash is at par value first:

= 3,300 x $5

= $16,500

Now, we find what is sold above par:

= $37,400 - $16,500

= $20,900

Finally, we prepare the journal entry:

Account                           Debit                      Credit

Cash                                  $37,400

       Additional Paid-In Capital                         $20,900

       Common Stock - $5 Par                          $16,500

      (To record issuance of common stock)

Learn more about bond issue here :  https://brainly.com/question/25596583

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